ACME Solar has finalized a ₹3,405 crore loan from Power Finance Corporation to build a 250 MW hybrid renewable energy project across Rajasthan and Gujarat. This deal secures long-term funding for a key project with a 25-year supply agreement, bringing the company's total financing this year to ₹6,051 crore.
ACME Solar Holdings has reached a financing agreement with Power Finance Corporation (PFC) to secure ₹3,405 crore for a 250 MW Firm and Dispatchable Renewable Energy (FDRE) project. The loan features a 19-year repayment timeline and will support the construction of a hybrid facility that combines solar, wind, and battery energy storage technologies.
Project Structure and Revenue Visibility
The project is being developed by the company’s subsidiary, ACME Urja One. To ensure consistent revenue, the firm has signed a 25-year power purchase agreement with NHPC at a rate of ₹4.33 per unit. By integrating battery storage, the project aims to solve the common renewable energy challenge of intermittent supply, allowing the company to provide stable power to the grid. The infrastructure is located in Fatehgarh-II, Rajasthan, and Jamkhambhaliya, Gujarat. According to the company, primary milestones such as land acquisition and grid connectivity arrangements are already finished.
Financial Context and Expansion Strategy
With this latest infusion, ACME Solar has raised a total of ₹6,051 crore in project financing during the current financial year. The company currently manages a renewable energy portfolio of 8,070 MW. This includes 2,990 MW of operational capacity and 5,080 MW that is currently under construction. Beyond generation, the developer is also working on 3.62 GWh of battery energy storage capacity.
Understanding the FDRE Business Model
The shift toward Firm and Dispatchable Renewable Energy represents a strategic move for developers in India. Unlike standard solar projects that only produce electricity during daylight hours, FDRE models use storage to supply power on demand. For investors, this model often provides more predictable long-term contracts with state-owned utilities or central agencies like NHPC. However, the profitability of these projects is closely tied to the cost of battery storage systems and the efficiency of the hybrid generation. As the company moves toward commissioning the project next year, the key factor to monitor will be the successful integration of these storage systems and the company's ability to maintain its profit margins while managing the debt raised for these large-scale expansions. Continued reliance on debt for project development requires the company to maintain steady cash flow from its existing operational assets to meet interest and principal repayment obligations.